《《Investment 8th Chap001》.docVIP

CHAPTER 1: THE INVESTMENT ENVIRONMENT PROBLEM SETS 1. Ultimately, it is true that real assets determine the material well being of an economy. Nevertheless, individuals can benefit when financial engineering creates new products that allow them to manage their portfolios of financial assets more efficiently. Because bundling and unbundling creates financial products with new properties and sensitivities to various sources of risk, it allows investors to hedge particular sources of risk more efficiently. Securitization requires access to a large number of potential investors. To attract thes